Bruce ElyPaul Romain, lobbyist for the beer and wine distributors, sent emails to the OLCC director advising him on "talking points."

The director of Oregon's liquor agency is under fire at the Legislature for targeting a discount grocery chain that wants to store and ship wine without paying distributors, and for working closely with a high-profile lobbyist representing those wine distributors.

Documents surfaced this week that show frequent communication between Paul Romain, who represents beer and wine distributors, and Steve Pharo, director of the Oregon Liquor Control Commission. In them, they discuss how to block a bill that would benefit Grocery Outlet while taking business away from the distributors.

Others show Romain working with the OLCC in an effort to get the federal government involved in ruling against Grocery Outlet. The documents -- mostly emails -- were obtained by John DiLorenzo, another big-time lobbyist who represents Grocery Outlet.

"Some of these emails are just stunning in the bias they reflect," said Sen. Betsy Johnson, D-Scappoose. Johnson was one of two lawmakers who blistered Pharo and his agency in a public hearing Monday.

The other was Sen. Jason Atkinson, R-Central Point, who all but accused the director and his deputies of lying about how much it would cost to collect taxes from stores that bypass wine distributors. Atkinson is the sponsor of Senate Bill 438, which would allow Grocery Outlet and other retailers to store wine in central warehouses and then deliver it to their stores.

"I don't like dishonesty," Atkinson said at the hearing. "These people are not dealing in good faith."

The whole issue could turn into one of those mid-session flare-ups that quickly burn out, leaving few visible traces. But it's a good reminder of the power struggles that play out daily at the Capitol, this one pitting one business interest against another and featuring two of the most successful lobbyists in the state.

Roger JensenJohn DiLorenzo, lobbyist for Grocery Outlet, requested copies of emails under the state public records law and shared them with lawmakers, causing a fracas.

Pharo called the criticisms off-base and said they reflect a lack of understanding of how the agency works. He said he talks to many lobbyists, legislators and citizens, and said it's merely "coincidental" if their views align with his agency's.

As for the cost of tracking the wine and collecting taxes, he said the original version of the bill had no additional price tag. But then the bill was amended and expanded to the point where Pharo estimated it would take an additional five full-time OLCC workers to handle the logistics.

"Frankly, I think a lot of this was politically motivated," Pharo said about the hearing. "They want the bill to pass."

Grocery Outlet has been battling both the OLCC and the beer and wine distributors for years.

As far back as 1986, the chain was told by OLCC that it could store wine at its central warehouse in Clackamas and ship the wine to its stores, which sells groceries and wine at prices that are often lower than other stores by 20 percent or more.

In late 2007, the chain was told it could no longer cut out the distributor middleman. That prompted a lawsuit and proposed legislation. The issue is now awaiting a decision of the state Court of Appeals.

Meanwhile, DiLorenzo and Atkinson are pushing a bill that would essentially moot the court decision and allow the grocery chain to continue operating as it has.

DiLorenzo said he requested copies of emails between Romain and the OLCC and was disturbed by what he saw. He says the emails show the OLCC providing a lobbyist for the beer and wine distributors an inside track to try to kill a bill that would help Grocery Outlet.

One email from Romain to Pharo is labeled "Senate Bill 438 Talking Points," and in it Romain says, "Attached are some notes for possible testimony on Thursday."

"It seems to me that is something that's not appropriate," DiLorenzo said.

Romain chuckled out loud when he heard the charge. He said it's his job to inform the OLCC about issues important to his clients. Furthermore, he said, the beer and wine distributors sought and were given approval to intervene in the lawsuit on the side of OLCC.

"Of course I'm communicating with them on a regular basis," he said, suggesting the release of the emails by DiLorenzo was more of a political stunt than an attempt to reveal supposed wrongdoing by OLCC.

"John's trying to do everything in his power to light a nuclear device" to get good treatment for Grocery Outlet, Romain said. "When it starts getting personal, that's when I object to it."

Johnson and DiLorenzo also highlighted a document in which the OLCC notes that Gov. John Kitzhaber had asked them to "remain neutral" on the bill. The emails show that's not the case, they said.

Christine Miles, spokeswoman for Kitzhaber, said it's common for the governor to ask an agency to stay neutral on a bill that might affect it. Asked about whether the OLCC went against Kitzhaber's wishes, Miles said, "That's something that we're looking into."